Morgan Stanley’s Ryan Fiftal upgraded the rating on the company from Underweight to Equal-Weight, while raising the price target from $55 to $59.

While Scripps Networks’ shares have underperformed peers, the company appears poised to benefit from ratings strength and a stable TV ad market, Fiftal said.

Scripps Networks’ stock has lagged peers by 25pts over the past 2 years. With the shares trading at the lower-end of peers, they already reflect the company’s modestly below-average growth outlook, creating a more balanced risk/reward profile, analyst Ryan Fiftal mentioned.

Scripps Networks’ exposure to advertising is about 70 percent of total revenue, which is above that of its peers. This continues to be a risk, “particularly given our relatively cautious medium-term outlook for TV advertising,” Fiftal commented.

The company is relatively well positioned to leverage this strength, given above-peer ratings

US affiliate revenue constitutes about 30 percent of Scripps Networks’ total revenue. While US affiliate revenue growth is also at risk, the company’s “price / value equation appears favorable,” Fiftal wrote.